How BMY (Bristol-Myers Squibb Company) Makes Money in 2025: A Deep-Dive With Income Statement

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Understanding how a global biopharmaceutical leader like Bristol Myers Squibb (BMY) makes money is essential for investors and anyone interested in the business of innovative medicines. In this post, we break down BMY's quarterly income statement (Q3 2025) using a Sankey chart to visualize the financial flows — what comes in, where it goes, and what's left as profit.

Quick Bristol Myers Squibb Overview

Bristol Myers Squibb operates as a leading biopharmaceutical company focused on discovering, developing, and delivering innovative medicines for patients with serious diseases. Its revenue comes primarily from the sale of prescription drugs in oncology, immunology, cardiovascular, and fibrosis. The company’s business model is driven by a robust pipeline, global commercialization, and strategic alliances.

Revenue is generated mainly through Net Product Revenue (sales of branded pharmaceuticals), with a smaller portion from Alliance & Other Revenue (collaborations, royalties, and licensing). BMY’s business segments are centered on therapeutic areas, with oncology and immunology representing the largest contributors.

Revenue Breakdown

• Total Revenue (Q3 2025): $12.2B (+2.8% YoY)
  • Net Product Revenue: $11.9B (97.0% of total, +3.2% YoY)
  • Alliance & Other Revenue: $372M (3.0% of total, -9.0% YoY)
  • Growth is powered by strong performance in key oncology and immunology brands, offsetting declines in alliance revenues.

Gross Profit and Margins

• Gross Profit: $8.79B (71.9% gross margin)
  • Cost of Revenue: $3.44B (+16.2% YoY)
  • Bristol Myers Squibb maintains robust margins due to a high-value portfolio of patented medicines and operational efficiencies in manufacturing and supply chain.
• Most costs come from manufacturing, procurement of raw materials, and royalties paid on licensed products.

Operating Income and Expenses

• Operating Income: $3.64B (+67.5% YoY, 29.8% margin)
• Operating Expenses: $5.15B (-42.4% YoY)
  • R&D: $2.53B (+6.5% YoY, 20.7% of revenue) — Focused on advancing the pipeline in oncology, immunology, and cardiovascular disease.
  • SG&A: $1.79B (-9.8% YoY, 14.6% of revenue) — Includes global sales, marketing, administrative, and support functions.
  • Bristol Myers Squibb continues to prioritize innovation through R&D while maintaining efficiency in SG&A and other operating costs.

Net Income

• Pre-Tax Income: $3.11B (+85.8% YoY, 25.5% margin)
• Income Tax: $919M (29.5% effective tax rate)
• Net Income: $2.20B (+81.8% YoY, 18.0% net margin)
• Bristol Myers Squibb converts a significant portion of sales into profit due to the scalability of its drug portfolio and disciplined cost management.

What Drives Bristol Myers Squibb's Money Machine?

• Net Product Revenue: 97%+ of revenue comes from branded pharmaceutical sales, led by blockbuster drugs in oncology and immunology.
• R&D Investment: $2.53B in Q3 2025, representing 20.7% of revenue, underpins future growth by advancing late-stage clinical programs and expanding indications for existing drugs.
• Strategic Alliances: Alliance & Other Revenue, while a small share, reflects ongoing collaborations and licensing deals that supplement core product sales.
• Future Growth Areas: Cell therapy, next-generation immunotherapies, and digital health initiatives are key focus areas, though not yet major profit contributors.

Visualizing Bristol Myers Squibb's Financial Flows

The Sankey chart below visualizes how each dollar flows from gross revenue, through costs and expenses, down to net income. This helps investors spot where value is created, what areas weigh on profits, and how efficiently the company operates.

• Most revenue flows into gross profit, with operating expenses (especially R&D) taking the largest chunk.
• Even after large investments in research and development, 18% of revenue drops to the bottom line.

Key Takeaways

• Bristol Myers Squibb's money comes overwhelmingly from branded pharmaceutical sales in oncology and immunology.
• High gross and net margins illustrate the power of BMY's patent-protected portfolio and efficient operations.
• Heavy investment in R&D, balanced by efficiency in SG&A and manufacturing costs.
• Ongoing growth is driven by blockbuster drugs, pipeline innovation, and global expansion.

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FAQ About Bristol Myers Squibb's Income Statement

1. What is the main source of Bristol Myers Squibb's revenue in 2025?

Bristol Myers Squibb generates over 97% of its revenue from Net Product Revenue, primarily sales of branded prescription drugs in oncology and immunology. Alliance & Other Revenue, including royalties and collaboration income, accounts for the remaining 3%.

2. How profitable is Bristol Myers Squibb in Q3 2025?

Bristol Myers Squibb reported net income of $2.20B in Q3 2025, with a net margin of approximately 18%, reflecting strong profitability driven by high-margin drug sales and disciplined cost management.

3. What are the largest expense categories for Bristol Myers Squibb?

The biggest expenses on Bristol Myers Squibb's income statement are operating expenses, particularly Research & Development (R&D) at $2.53B in Q3 2025 (20.7% of revenue), as the company prioritizes pipeline innovation. SG&A costs were $1.79B (14.6% of revenue), supporting global sales and administration.

4. Why does cell therapy operate at a loss?

Cell therapy, despite generating $XXM in revenue, posted an operating loss of over $XXB in Q3 2025. This is because Bristol Myers Squibb aggressively invests in clinical development and manufacturing scale-up, believing these will drive long-term growth—even if the division is unprofitable today.

5. How does Bristol Myers Squibb's effective tax rate compare to previous years?

Bristol Myers Squibb's effective tax rate in Q3 2025 was 29.5%, consistent with previous years. This moderate rate is primarily due to the geographic mix of earnings and available tax credits from R&D investments.